|Dialling the future|
|Tuesday, 11 October 2011 00:00|
Telecom minister Kapil Sibal has done a fine job of outlining the contours of what India wants its telecom future to look like. While there are many strands to the policy that Sibal announced, a few stand out. One, there will be one licence for all services (an Internet provider can provide voice services, and vice versa); there will be no roaming charges eventually (while Shourie began the universal licence trend by combining fixed and mobile services in one licence, Maran’s OneIndia plan almost ended the difference between STD and local calls); there will be a separate Network Service Operator (an Alcatel can buy spectrum and allow telcos to use its network to connect their clients at lower rates since larger spectrum allows dramatically lower costs); most important, 300 MHz of spectrum will be provided by 2017 and another 200 MHz by 2020. Goodbye high-cost spectrum, goodbye call drops!
As always, the devil lies in the details, and Trai will be asked to float discussion papers on the way forward, before making its recommendations. Consider a few pitfalls along the way. One licence for all services sounds good, but does this mean that Internet providers also need to have rollout obligations now?; one licence means there will be one uniform licence fee, but what will this be—Trai is in favour of 6%, but the DoT favours a higher one and surely mobile firms who will lose 7.5% of revenues with the zero-roaming scheme will need compensation; allowing sharing of networks is an idea that’s long overdue, but consider the government is currently taking action against telcos who are sharing their 3G networks even though this was very clearly allowed when the auctions were done. When Trai wants 74 of Raja’s 122 licences to be cancelled, it’s not clear what Sibal meant when he said an exit policy would be framed—in keeping with this was Sibal’s grandiose statement that revenue generation would not be the cornerstone of the new policy (was he once again reiterating his there-was-no-loss theory?). Similarly, while ‘right to broadband’ is a laudable objective, and the minister even spoke of tackling the right-of-way problem in various states, he said nothing of asking BSNL/MTNL to open up their networks which will make broadband provision easier. Given the poor pace of getting government agencies to vacate spectrum so far, it’s not clear whether the spectrum promise will be met. Sibal’s real job will be done when he irons out the fineprint.